Economists Express Growing Concerns With America's Financial Future

This is a rush transcript from "Hannity," July 9, 2010. This copy may not be in its final form and may be updated.

TUCKER CARLSON, GUEST HOST: President Obama has called this the summer of recovery, but the former chairman of the Federal Reserve has a drastically different view of the state of the American economy.

Good evening I'm Tucker Carlson of The Daily Caller in tonight for Sean Hannity.

Alan Greenspan, who ran the Fed for nearly two decades, said today, he believes the U.S. economy may be undergoing a quote, "pause." In addition, Greenspan refused to rule out the possibility of a double dip recession.

With the economy in a pause, this week our president also took a break from his daily routine to fly to Las Vegas where he campaigned for Senate Majority Leader Harry Reid.

Back in Washington though, some of the president's top aides are still hard at work and reportedly have launched a campaign to convince Wall Street that this White House isn't anti-business. Treasury Secretary Tim Geithner and White House Chief of Staff Rahm Emanuel kicked off the offensive of the series of interviews yesterday.

The move comes in the aftermath of a bombshell report in The Washington Post that shows Wall Street contributions to the Democratic Party are dramatically down, 65 percent from the 2008 election cycle.

So, are the administration's policies promoting a recovery or are they in fact anti-business?

Here with analysis on that, and much more the author of "The Sellout," Charles Gasparino is here, along with Nicole Petallides, both from the Fox Business Network.

Nicole, is it your sense that the Obama administration is claiming, it's not anti-business because clearly it is because, it doesn't want any business or because it wants the campaign contributions?

NICOLE PETALLIDES, FOX BUSINESS NETWORK ANCHOR: Definitely trying to play both sides of the fence and that doesn't work. It's so clear to the people in business that this administration is not business friendly. You are hearing it from billionaires like Mortimer Zuckerman, you're hearing it from the GE CEO Jeffrey Immelt talking about it, we're seeing it still on Wall Street, they are bashing Wall Street, they are bashing businesses. These banks are scared, businesses are scared, they are worried about taxes. There's nothing friendly about this administration to business.

CARLSON: Well, I agree with that Charlie. We know all these guys.

CHARLIE GASPARINO, FOX BUSINESS NETWORK SENIOR CORRESPONDENT: We brought the story about the chamber fence.

CARLSON: That's right, and Jeff Immelt who's telling, he's never helped the Obama elected in the first place. If he's complaining about it — a lot of these guys voted for Obama.

What was the moment they changed their minds?

GASPARINO: You know, it wasn't one moment but it occurred over the course of the year where several things, first off, you know, if you talk to some of these guys, you talk to Jamie Dimon, the CEO of JP Morgan Chase, big Obama supporter. He said, listen, I voted for Obama because yes, I wanted the change, I wanted to help people. I didn't want to create new entitlements, you know, I don't want to sort of re-redistribute wealth.

I mean, this is what they really thought, they thought he was a moderate. Listen, I told them — you know what I said to these guys when they told me that? I said, have you ever heard of Jeremiah Wright? I mean, Jeremiah Wright, whether, you know, his racist rhetoric, you know, it is there. But he's also a Marxist, he teaches a liberation theology. How can you vote for a man who considers, and you're a business man, considers a Marxist to be a spiritual mentor?

CARLSON: It's a pretty tough case to make, don't you think, the White House making a case that it's economic policies have exceeded when the deficit for the second year in a row over trillion bucks.

PETALLIDES: It really is. And they say that it's coming down because of some corporate revenues that are going up. But, really, honestly, this administration I feel as an American is trying to pull wool over my eyes. Oh, jobs, jobs are getting better, we are at 9.5 percent unemployment rate. Well, the reason we're at 9.5 percent rather than 10 is because people have stopped filing for unemployment.

CARLSON: What do you think the real rate is?

PETALLIDES: Well, it's probably like 13, 16, 17.

GASPARINO: I mean, that's the real sort of I guess, scandal here. I mean, if you think about it, and again, talk to some of these CEOs that voted for Obama, you know we spent a year debating health care, right? Guess what happened during that year? Unemployment remained at around 10 percent. Construction industry is at 23 percent. Whatever happened to those shovel ready jobs that the stimulus package was supposed to produce?

This from an economic standpoint, this administration is a failure and it's become an even obvious to his supporters. And it's not just a failure. It looks like there's a degree of incompetence here, right? I mean, if you, basically, if you create employment, people get health care. You realize that.

CARLSON: Right.

GASPARINO: And I think that the — what corporate America worries about in Obama is that they really do worry if his sensibilities are really socialist. They believe — they thought he was a moderate. And now these top CEOs, people that voted for him and supported him believe he might be a socialist. I think he's a leftist if you ask me but I'm just saying that, that's where they've come.

CARLSON: It's just dawning — these captains of industry, the geniuses at the helm of our economy.

(CROSSTALK)

PETALLIDES: These businesses, they don't really know what to expect anymore, right? They are afraid to hire. They don't know what their costs are going to be. The taxes are increasing. The game continues to change. Health care costs are going up for them.

So, the game for Wall Street, for businesses, there's nothing business-friendly about the administration at all that is working. And the consumer, us, right? That is us, this consumer weakness, concerns about jobs and concerns about housing. That's not doing anybody any good either.

GASPARINO: I also think there's a fear of economic incompetence from the administration.

CARLSON: Right.

GASPARINO: I mean, I think, it's more than just they don't like some of his policies. They, you know, they don't like higher taxes which, you know, no business likes higher taxes. They worry about that this guy really doesn't know what he's doing when it comes to the economy. When you say, listen, I'm going to spend $800 billion and we're going to keep unemployment at 8 1/2 percent and it's going to go down to seven and stays at ten? I mean, that, there's something wrong, someone is not reading, someone didn't plug in the numbers right in the equation.

PETALLIDES: Right. How about the stimulus?

GASPARINO: And that's what they're worried about.

PETALLIDES: How about the stimulus? Cash for clunkers. Auto sales went up. As soon as that was done, auto sales come down. How about housing when they were giving the tax credit, the tax rebate for people who are buying houses. Housing went up, housing went down. As soon as those kinds of stimulus end, it doesn't work anymore. What you need to do is create jobs, so people have money, so they can go and get these things themselves.

CARLSON: But I thought where seeing the resurgence of Keynesian economics where basically a permanent stimulus would be in place, driving the economy back up. Have we given up on that idea?

GASPARINO: Well, let me ask you a question. You believe there needs to be a stimulus because I do, right? Don't we need a stimulus?

CARLSON: I never bought into it from day one.

GASPARINO: You don't believe —

CARLSON: I was the only person in Washington, D.C. I was against the bailout. I was against the stimulus.

GASPARINO: Are you against lower taxes?

CARSON: Of course not.

PETALLIDES: I like lower taxes.

GASPARINO: OK. Well that's a stimulus. I mean, I think that's the problem here. He went back to Keynesian economics that, you know, historically, you know, if you study the history of Keynesian economics, that's why we had a great depression, ten years of lousy economic growth, and lots of government spending, those programs generally don't work. And look at this program, $800 billion, money, transferred to the state, allegedly for shovel-ready projects. Guess what they did? The state just used the close budget gaps, so we didn't get the shovel-ready jobs. And I think that's what the business community is worried about. We have an administration that when they spend money, they don't really know what they are spending it on. They really don't have their economic priorities right.

CARLSON: It doesn't matter. It doesn't matter. Money out there into the so-called community or funnel-through unions is good enough. That is stimulus. That is basically the case they're making

PETALLIDES: They are putting signs, they are building, things that they were redoing a train depot that hadn't been used in ten years. Use the money to create jobs. They are doing all these things that really are not relevant. They are spending our money.

CARLSON: What is our outlook?

PETALLIDES: What's my outlook?

CARLSON: Yes. What's you outlook? I mean.

PETALLIDES: Well, you know, what do I hope or what do I think?

CARLSON: Let's evaluate.

PETALLIDES: Double dip recession is a possibility.

CARLSON: You think it is?

PETALLIDES: People have no jobs. I mean, it's a possibility. But I'd like to think that things are getting a little bit better and it's really all about confidence and whether not people can get jobs and have it happen.

CARLSON: My question is, Rahm Emanuel, and this says a lot, is the most trusted man in the White House on economics. Which tells you — if a political adviser is the most —

GASPARINO: You know, I don't know about that, I wonder if it's him or if it's David Axelrod or someone in that — in sort of, you know, Rahm Emanuel, people know me, he's not exactly a real lefty, here's more of a moderate.

CARLSON: No, no. That's my point. Business looks on to the White House is that the only guy who sort to gets to this is Rahm Emanuel. That's he's the most reasonable guy.

GASPARINO: They believe Tim Geithner. But, you know, they're powerless. From what I understand from a business standpoint, they are really powerless when it really comes to who's calling the shots. You ever hear of Valerie Jarrett? Not exactly someone you want calling the shots.

CARLSON: Not because Valerie Jarrett's never had a real job?

GASPARINO: Well, she was a lobbyist and a lawyer and she reflects a lot of the president's political views. And she — from what I understand, she is one of the most important people from a policy standpoint. Look, I ran into Bob Rubin once and he basically told me — Bob Rubin, the former Clinton Treasury secretary — like him on Wall Street but, you know, he was pretty good as a Treasury secretary for a time. And he told me that he ran into Obama. And, he said, you know, Mr. President, you never ran a business. You never, you know, you don't know much about business. So, you should talk to people. And he goes, well, you know that's why I got Valerie.

CARLSON: That's unbelievable.

GASPARINO: That's what he told me.

CARLSON: Would you mind confronting the president with that the next time you see him?

PETALLIDES: Yes, we'll bring that up to him. This is unbelievable. That's a good story Charlie got.

CARLSON: Charlie, thank you. That's a great story.

PETALLIDES: Thank you, Tucker, for having us.

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